Omega Case Study Report

This report is based on the case study of Omega. With external pressure, the company is now encountering internal problem, like high turnover and absenteeism rate. Personnel manager adopts attitude survey to analyses current situation. “Job attitudes and job performance are perhaps the two most central and enduring sets of constructs in individual-level organisational research” (David, Daniel and Philip, 2006:305). Organisations increasingly tend to use attitude survey to analyses their employees’ attitude and opinion towards employers (Paul R, 1988:145). Omega case provides an attitude survey questionnaire and relevant data.

This report is based on these data to analyses the current situation of Omega, also discuss the reason of high absenteeism and turnover rate among professional staff using organisational behaviour theories, and propose recommendations for Omega to step off the dilemma.

1. The questionnaire

Before deep discussion, it ought to go into the questionnaire Omega adopts, “Questionnaires can provide evidence of patterns amongst large populations”(Louis and Gravin, 2010:1). However, the design of the questionnaire has some problems.

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The questionnaire is consist of closed questions and open questions, including five areas in attitude evaluation, but the order of each question is “randomly presented”, which could confuse respondents when they do the questionnaire and easily get bored due to misunderstanding the purpose. In terms of open questions, their existence is to check the close questions are enough or not. Actually, experienced researchers choose open questions to understand respondents’ motivations and feelings in depth (Babara, 1965:175).

2.0 Current situation of Omega

It can be describe the current situation of Omega as internal revolt and external invasion.

Due to limitation, this report analyzes internal revolt of Omega. This part begins with a review of the literature on low job satisfaction. In addition, low organisational commitment, inefficient communication system, improper leadership are also included.

2.1 Low job satisfaction

In order to analyze the job satisfaction level, it is firstly should make assure what is job satisfaction. James (1992) defines job satisfaction as “the extent to which employees like their work”. And Luthans (2011:141) suggests “job satisfaction is a result of employee’s perception of how well their job provides those things that are viewed as important”. After explain job satisfaction, the measurement is put forward below .

There are six facets of job satisfaction, which are the work content, financial rewards, hierarchical satisfaction, management, peers, and working conditions (Paul, 1997: 12). In terms of work content, Bozionelos (2007: 13) suggests five aspects to consider work itself, such as, skill variety, task identity, task significance, autonomy and feedback, which according Omega’s situation, they are low. It is a little better of the financial rewards aspect than the work content but still is low. Employees do not hold the shares of Omega and they think company underestimate their effort and their value and just 34% employees think they are paid fairly.

Hierarchical satisfaction is not very clearly discussed in this case. Management satisfaction in Omega is mediate. Nevertheless, 89% of respondents think their immediate superiors treat them fairly. Other factor, namely, level of support, is low. Coworker satisfaction is not high as well because only 42% of respondents’ stay in company due to coworkers. Work condition in Omega supposes to be low because employees think manager does not care about the work condition, so work condition might be low. Through analyses above, job satisfaction of Omega could be judged as low.

2.2 Inefficient communication system

David (1997, 42) defines communication process as “the transmission of information, and the exchange of meaning”. Robbins (2010: 290) points out six main parts of communication process, such as the information giver, encoding, the information, the channel, decoding, information receiver, interference and feedback. Omega lack channel and feedback of communication process, so the process is not seriously exist in Omega.

There are many directions of communication in organisation, namely vertically up and down, horizontally with coworkers (Katherine, 2012:31). Robbins (2010:291) also points out the main role of downward communication is to explain the reasons of different decisions. In Omega even the result of questionnaire is sent to the home address of employee not through company’s internal mail system. This could demonstrate the communication in company is really weak.

David (1997, 42) defines communication process as “the transmission of information, and the exchange of meaning”. Furthermore, Cal and Allison (2004:6) say feedback could be an important facet to assess communicational efficiency and different company will have different emphasis on communication process. In Omega, they seldom receive feedback from their superiors. Furthermore, employees even do not know what happened in other regions of company or some issues relate to Omega. Through these analyses the communication system in Omega is really inefficient.

2.3 Low organisational commitment

Organisational commitment is one of attitudes employees have towards organisation. Allen and Meyer(1991,) suggest organisational commitment consist of three parts “a desire (affective commitment: an emotional attachment to organiasation) to stay in a company; a need(continuance commitment: consider cost of leaving the company) to stay and an obligation(normative commitment: moral and ethical consideration) to stay”

Though the questionnaire of Omega is not very clearly include organisational commitment questions, it still can be reckoned by similar questions. The question about belonging to Omega can be recognized as affective commitment question and only 23% of respondents think they have this feeling, which means the affective in Omega is low. In addition, when ask if any other company offered more than 5% salary will you leave Omega, 27% of respondents will leave. And when it is raised by 10%, the result is 52%, and raised by 15% then 75% will leave.

However, 89% of them do not treat financial reward is the most important aspect of their job. In this way, it could be reckoned normative commitment in Omega is low, meaning there is little moral or ethnic factor employees consider when they choose to leave company. Though there is few content of questionnaire relating to continuance commitment, organisational commitment is still low from the other two aspects.

2.4 Improper leadership

Robbins (2010:316) define leadership as “the ability to influence a group toward the achievement of a vision or set of goals”. Furthermore, Bozionelos (2007:14) claims “the main role of leader is to motivate his/her subordinates.” He also points out leaders could motivate employees by using “right” style. According to OHIO style studies, high consideration sometimes is associated with less turnover and absenteeism. Employees in Omega mainly are highly educated, who have interests in company operations and have strong aspirations to get involved in their job, not just finishing the task superiors give them. Nevertheless, leaders in Omega ignore the workforce environment and adopt improper leadership, like ignoring their opinions and isolating them from the whole company, furthermore, providing unsatisfied working environment. In conclusion, leadership in Omega is improper.

3.0 Analyses high turnover and absenteeism

The relationship between turnover and absenteeism is positive, which means high turnover relate to high absenteeism vice versa (Terry, 1978). There are several reasons to the high absenteeism and turnover rate. Robert (1993) figures out job satisfaction and organisational commitment negatively relate to the turnover and absenteeism. In terms of the relationship between the two, there are mainly two different views, one of which is “the commitment mediate the effect of job satisfaction” (Porter, 1974), the other one of which is the two both have impact on turnover but separately (Dougherty, 1985). This report follows the latter view. In addition, motivation theories are also mentioned below.

3.1 Job satisfaction reason

Bozionelos (2007: 13) implicates the relationship between job satisfaction and absenteeism is moderate strong and Bobbins(2010: 72) supports this view and think the relationship is moderate to weak. According to these two scholars, there are many other reasons independent on job-related aspect, like the traffic situation and family stuff like child’s sick, etc. And Bozionelos(2007: ) mentions unsatisfied employees are more likely truancy than satisfied ones participate in work, which means make employees satisfying could not make sure low absenteeism, but if employees are unsatisfying they will more likely absent.

Tett and Meyer(1993) conclude the relationship between job satisfaction and turnover is also moderate. However, Carsten and Spector (1987) point out job satisfaction will lead to turnover when employees find it easy to find an other similar job. 47% of respondents would leave company if they find a comparable job. In this way, job satisfaction is strongly relate to quit.

Given the theory mentioned above and analyses of job satisfaction level in Omega, It could make a conclusion that job satisfaction in Omega is low and moderately leading to high turnover and absenteeism rate.

3.2 Organisational commitment reason

“Empirical research on organisational commitment generally has shown commitment to be a significant predictor of turnover” (Gary, 1987). Also, John and Dennis (1990) demonstrate organisational commitment could help organisation reduce withdraw behaviour, like absenteeism and turnover. Furthermore, some scholars support the view that high organisatioanl commitment could lead to high job satisfaction (Batemen and Strasser, 1984).

In terms organisational commitment itself, Robbins(2010:64) demonstrate organisational commitment negatively relate to both absenteeism and turnover, and in particular, affective commitment have stronger relationship than other two type of commitment with turnover and absenteeism. Meyer (2002) after a meta-analyses support Robbins conclusion, and figure out affective commitment is the strongest lead to high turnover rate(ρ = −.17). However, in terms of absenteeism, except affective commitment, the other two commitments have positive relationship with absenteeism.

Though there is few content of questionnaire relating to continuance commitment, organisational commitment in Omega still could explain the high turnover and absenteeism rate, because affective commitment is low, which is the strongest aspect influence withdraw behaviour.

3.3 Motivation reason

Motivation theories could explain the high turnover and absenteeism is because lack of motivation will have influence job satisfaction and organisational commitment, which have discuss above to be proved could impact quit and missing the job. Motivation theories used in this report are equity theory. Mullins(2002:443) explains equity theory as “focuses on peoples’ feeling of how fairly they have been treated in comparison with the treatment received by others.”

He points out one of inequity behaviour is “leaving the field” to find balance. In this way, employees are tend to absent and find other equal job. In addition, Laura (2000) suggests wage equity is related to worker motivation. Employees in Omega believe they are under inequity situation, because of inequity input and output. About 66% of respondents think they are paid unfairly. As a result, employees are tend to absent and change their job.

4.0 Recommendation

This part is mainly based on motivation theory and motivation applications method. Apart from motivate employees, improving job satisfaction, consummating communication system are also used to propose recommendations.

4.1 Motivate employee

Maslow’s theory and Herzberg’s theory are applied to suggestions. Though popular with its criticism, Maslow’s five level hierarchy theory is always the basic theory of motivation and is simply applied to real case. Maslow hierarchy need theory consists of five needs of a person, which, from the bottom to the top, are physiological, safety, love, esteem, self-actualization (Maslow, 1954). These needs are satisfied until the lower needs are fulfilled. Mangers need to identify dominant needs during employees then provide incentives to satisfy them in order to improve job satisfaction (Bozionelos , 2007: 29). In Omega case, manager should first identify what employees really needs. Except relatively satisfied salary, they also need more control in their work and more communication with superior.

Next theory using to propose suggestions is Herzberg’s two-factor theory, which are hygiene factors and motivators. Hygiene factors are mostly about work conditions and environment and actually hygiene cannot motivate employees, but if hygiene factors are not filled, they will lead to dissatisfaction. Motivators are mostly about work itself and work content. Robbins (2010:143) suggests it is advised to use motivator to motivate people, like “promotional opportunities, opportunities for personal growth, recognition, responsibility and achievement”. Omega manager or personnel manager can follow this suggestion to redesign the job in Omega.

4.2 Improve job satisfaction

Locke (1976) says job satisfaction is a “positive emotional state”, so improving job satisfaction is same as improving the positive emotion of employees. There are several aspects could lead to high level of job satisfaction. One of the most significant aspects relating to high job satisfaction is enjoying the job. Enjoyable job should provide necessary training, variety and authorization (Robbins, 2010:67). In Omega, managers could decrease close supervision when employees working, which probably could increase job satisfaction.

4.3 Consummate communication system

As mentioned above, the communication process is important in an organisation. Omega’s manager should provide a platform for employees to express their opinions, complains and proposals. In addition, frequent feedback is also essential during the whole communication process even though it may be the last step. Formulating new feedback policy in accordance with job’s need.

4.4 Improve employee involvement

Lawer (1986) suggests “job involvement has been considered the key to activating employee motivation”. In addition, employee involvement could also help improve job satisfaction (Steve, 1996). Involving employee can not only help improve job satisfaction but also help improve organiasational commitment. Daily update e-mail could provide latest news of company as well as satisfy employees’ need to understand organisation. Furthermore, involving employee could develop a feeling of belonging to organisation.

5.0 Conclusion

Through the analyses above, it is clear that there are numerous of problems in Omega. Low job satisfaction, inefficient communication system, low organisational commitment and improper leadership are the key problems. Some of them strongly relate to high turnover and absenteeism rate, some of them moderately relate. Recommendations are based on the problems, which most could be applied to real work. More importantly, taking actions to make ideas into reality is the key.

6. Personal reflection

This part mainly discusses the writer’s personal opinion on management. Fortunately, this case study gives me a lot of thinking about management and leadership. As a manager in a company especially in a highly educated organisation must pay attention to employees’ opinion towards company and management. Their involvement not only can level up their job satisfaction but also can help improve efficient of management. In addition, motivation system is another factor that should be taken seriously. Though there are many theories in motivation and many ways to motivate employees, actually, manager could choose one and utilize effectively, then can benefit a lot.

Personally speaking, leadership is more important than management. Management could just guarantee the implementation of task, but leadership have more function due to different leadership style. In terms of organisational commitment, managers’ leadership is very significant. Some companies have done a lot to improve organisational commitment but it is still low. That maybe because the improper leadership. Sometimes leadership is not could described in words just like art, which need talent.

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